Bulls And Bears

Positive US, Europe data fail to buoy STI

Asia's mixed showing at odds with signs of manufacturing turnaround in US, euro zone

Local shares had another tepid session yesterday despite encouraging economic data overnight from the United States and Europe.

The Straits Times Index (STI) pared 2.63 points or 0.09 per cent to 2,854.05, with only $713.9 million worth of shares changing hands across the whole market.

Elsewhere, Shanghai rose 0.12 per cent and Hong Kong fell 0.17 per cent. Tokyo was the region's top performer, up 0.76 per cent as the Japanese yen softened. A weaker yen is considered a boon for the country's exporters.

Asia's mixed performance was at odds with news that the October purchasing managers' index was 53.2 in the US and 53.7 in the euro zone - both above the 50-point line that separates contraction and expansion in manufacturing.

But these tentative signs of turnaround did not impress local investors, with only eight of the 30 STI component stocks rising yesterday.

Golden Agri-Resources, the top gainer, was up two cents or 5.26 per cent to 40 cents, on 44.5 million shares traded. The agricultural firm's shares have added around 13 per cent over the past month.

Wilmar International, another agricultural blue chip, rose two cents or 0.6 per cent to $3.37. It has put on around 6 per cent in the same period. The duo may have benefited from the recent build-up of palm oil futures in Malaysia, which hit the highest in 21/2 years on Monday. Profit taking is to be expected.

Thai Beverage resumed its winning ways, up half a cent or 0.52 per cent to 97 cents, and Singapore Press Holdings closed up one cent or 0.26 per cent at $3.81.

Meanwhile, 15 STI stocks ended in the red. Hongkong Land Holdings lost the most, down 10 US cents or 1.45 per cent to US$6.81. CapitaLand Commercial Trust pared two cents or 1.24 per cent to $1.59 on 16.7 million shares traded, and Hutchison Port Holdings Trust dropped half a US cent or 1.11 per cent to 44.5 US cents with 10.5 million shares done.

Keppel Corp slipped four cents or 0.74 per cent to $5.34, and Sembcorp Industries was off one cent or 0.39 per cent to $2.55. Outside the STI, Sembcorp Marine shed 1.5 cents or 1.13 per cent to $1.315. The rig-maker has reported a $22 million net loss for the third quarter.

Other counters in the offshore and marine sector also fell. Ezra Holdings lost 0.4 cent or 8.33 per cent to 4.4 cents with 78.8 million shares done - a top active - and Vard Holdings dropped 0.8 cent or 4.17 per cent to 18.4 cents.

Hospital and clinic operator Raffles Medical Group rose one cent or 0.66 per cent to $1.515, after reporting a 4 per cent rise in net profit for the three months to Sept 30. OCBC analyst Jodie Foo raised the stock's fair value to $1.61, saying: "We still believe the group offers a stable long-term growth story as expansion plans remain on track. Thus longer-term investors can look to accumulate at current price levels."

A version of this article appeared in the print edition of The Straits Times on October 26, 2016, with the headline 'Positive US, Europe data fail to buoy STI'. Print Edition | Subscribe